Friday, 11 August 2017

Finance: Walmart expands mobile checkout (WMT)

Walmart expanded its “Scan and Go” pilot program, which lets customers scan products’ barcodes through a smartphone app as they add items to their carts, to 10 new stores throughout Arkansas, Florida, Georgia, and Texas, reports Drug Store News.

This nearly doubles the number of Walmart locations trialing the feature, from 12 beforehand — potentially signaling positive early results.

Scan and Go adds some convenience to the checkout — but Walmart can go further to match the competition.

Walmart stands to benefit from shaking up the checkout. After Sam’s Club rolled out a similar technology chain-wide in late 2016, it saw a 10% higher average purchase amount among users. Furthermore, customers took to the new system — it funneled 10% of the chain’s total sales.

However, Scan and Go is not without friction. In Walmart’s scheme, once browsing is complete, customers must take the added step of walking to an “express bullpen” to show a barcode to an associate, who scans it, allowing them to pay for items in their app.

Amazon's system aims to eradicate payments altogether. Amazon Go, which is still in beta and not open to the public, aims to let customers simply walk out of the store with their products and be charged automatically. It works with cameras, using computer vision and machine learning to detect which products are put in carts, according to Amazon.

Execution, not vision, may determine the winner. This is Walmart’s second attempt to release the shopping technology, after the first shot fizzled out three years ago. Furthermore, Fortune reported in March that Amazon’s solution can only handle up to 20 shoppers at a time. While Walmart’s solution is not as disruptive as Amazon’s, there’s no guarantee the latter will work from a technical perspective any time soon. The wisdom of Walmart’s more conservative checkout enhancement will hinge on whether it successfully scales before Amazon.